Report on B.C.’s economy indicates a regional divide
A B.C. credit union says Vancouver, Victoria and Kelowna will lead the province in economic growth next year while other regions of the province will grow slowly.
Central 1 Credit Union says housing prices in Victoria and Kelowna will stabilize in 2017 after big price jumps this year. Metro Vancouver is expected to show what it describes as a “modest” decline in median home values of four per cent.
The economic region in Kootenay will see mild growth and unemployment stuck at about eight per cent.
Central 1 says the trend of lost jobs and declining population in the Cariboo might stop but won’t reverse through 2018.
The north coast and Nechako will continue to lose population and experience weak employment growth.
Bryan Yu, the credit union’s senior economist, said the province’s economy remains on a “solid footing.”
“Economic activity will continue to be underpinned by solid consumer spending, but growth will be curtailed by lower employment growth and weaker housing activity,” said.
He forecasts GDP growth to fall to 2.3 per cent in 2017, while the growth in employment will slow to 1.1 per cent after a surge this year.
The credit union said the prov- ince’s mixed growth prospects mean the continuation of a regional economic divide, with the Lower Mainland, Vancouver Island and Kelowna driving the economy.
“In contrast, the economic cycle outside these markets will remain tempered with still challenging conditions in the economy,” Yu said in a news release on Thursday.
“Weak commodity-related investment, closer reliance on Alberta’s oil economy and subdued global growth will continue to constrain economic activity.”
Yu also warned that uncertainty surrounding a new softwood lumber agreement and the “likelihood” of tariffs is a risk for lumber production.
“For the province as a whole through 2018, consumer demand will largely be driven by population growth, which is forecast to remain at a modest 1.2 per cent a year,” Yu said.
“International immigration is forecast to rise given higher federal immigration targets, while a relatively stronger economy will continue to attract workers from other regions of the country.”
The Canadian Federation of Independent Business said Thursday that B.C. was leading the country in the number of jobs that stood vacant in the third quarter at 3.5 per cent, the highest it has been since early 2008.